Withdrawal of the activity licence of investment fund managers upon request

If the investment fund manager does not wish to continue its activities any longer, it must obtain the authorisation of the Magyar Nemzeti Bank (MNB).

Kulcsszavak: investment fund management, venture capital fund managers, collective portfolio management, AIF, UCITS, funds, private equity fund, securities fund, real estate fund, venture capital fund

The investment fund manager may not discontinue the performance of its activities without the MNB’s authorisation; therefore, it needs to submit an application to that effect. Applications and the relevant attachments must be submitted by investment fund managers or their legal representatives through the MNB’s ‘ERA’ system (Electronic System for Receiving Authenticated Data). Detailed information on e-administration and on the substantive and formal requirements of electronic documents can be found on the MNB’s website at the following link:

https://www.mnb.hu/letoltes/tajekoztatas-az-e-ugyintezesrol-az-mnb-elotti-engedelyezesi-eljarasokban-1.pdf

Engagement in collective portfolio management activities without authorisation constitutes a criminal offence, and the MNB may commence a market surveillance procedure if it suspects engagement in unauthorised collective portfolio management activities.

If the MNB finds that an activity is performed without authorisation, it will

a) prohibit the activity,

b) initiate criminal proceedings if, in its opinion, a criminal offence is involved under the Act on the Criminal Code,

c) apply measures or exceptional measures, and/or

d) impose a market surveillance fine.

If the submitted application contains insufficient information, within 45 days of receipt of the application the MNB will request that the applicant to submit supplementary information. In the case of complete applications, the MNB will make a decision within three months of receipt of the application.

The investment fund manager must certify that it no longer has any liabilities arising from the activity to be discontinued.

The authorisation procedure is free of charge.

Magyar Nemzeti Bank, Money and Capital Markets Licensing Department

The MNB’s decision (resolution or ruling) may not be appealed; however, customers whose rights or legitimate interests are directly affected by the decision may initiate administrative court proceedings within 30 (thirty) days of the disclosure of the resolution or ruling on the grounds of infringement, by submitting an application initiating proceedings to the Budapest-Capital Regional Court.

Legal representation is mandatory in the court proceedings. The application must be addressed to the Budapest-Capital Regional Court, and submitted electronically through the MNB’s form submission support service.

(The form submission support service can be accessed at: https://www.mnb.hu/felugyelet/engedelyezes-es-intezmenyfelugyeles/hatarozatok-es-vegzesek-keresese)

The submission of the application has no suspensive effect on the enforceability of the resolution or ruling, but the customer may request interim relief. Generally, the court rules in the proceedings without holding a hearing; however, the customer may request a hearing in the application. If no hearing is requested, a hearing may not be requested later on during the appeal procedure.

An application for a remedy may be lodged by any party who goes over a time limit or misses a legal deadline during the procedure for reasons beyond their control.

Additional general information about the authorisation procedure is available at: https://www.mnb.hu/felugyelet/engedelyezes-es-intezmenyfelugyeles/engedelyezes/tajekoztatok

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Act XVI of 2014 on Collective Investment Trusts and their Managers, and on the Amendment of Financial Regulations

Act CXXXIX of 2013 on the Magyar Nemzeti Bank (Central Bank of Hungary)

MNB